An Act to amend the law relating to
Powers-of-Attorney

Local extent, commencement —It applies to the
whole of India (except the State of Jammu and Kashmir) and it shall come into
force on the first day of May, 1882.

COMMENTS

According to
Osborn's Concise Law Dictionary, 7th Edn., a 'power-of-attorney' means a formal instrument by which one person
empowers another to represent him, or act in his stead, for certain purposes,
usually in the form of a deed poll, and attested by two witnesses. The donor of
the power is called the principal or constituent; the donee is called the
attorney or agent. The latter is not entitled to exercise his powers for his
own benefit e.g. draw cheques on the former's account to pay his own debts.

In this Act, "Powers-of-Attorney" include any
instrument empowering a specified person to act for and in the name of the
person executing it.

2. Execution under power-of-attorney —

The donee of a
power-of-attorney may, if he thinks fit, execute or do any 6[xxx] instrument or
thing in and with his own name and signature, and his own seal, where sealing
is required, by authority of the donor of the power; and every 6[xxx]
instrument and thing so executed and done, shall be as effectual in law as if
it had been executed or done by the donee of the power in the name, and with
the signature and seal, of the donor thereof.

This section applies
to power-of-attorney created by instruments executed either before or after
this Act comes into force.

COMMENTS

(i) A holder of a
power-of-attorney or an agent can not go beyond the principal. If it is found
that there is a serious doubt as to whether the principal may have authorised
in a 'normal state of mental frame' or mind which would give him/her
independent disposition and thinking power so as to exercise control over the
agent, then such 'power-of-attorney' becomes worthless and null & void from
the legal angle. [Mahendra Pratap Singh & Anr. v. Smt. Padam Kumari Devi,
A.I.R. 1993 All. 143].

(ii) In
circumstances, when the principal has become old, weak, mentally
infirm/incapable, and not in a position to have independent disposition and
thinking power, continuing to act on such power of attorney will be unethical
& immoral on the part of the agent and would amount to fraud, cheating,
misappropriation & criminal breach of trust. It would cease to have validity
in law. [Mahendra Pratap Singh & Anr. v. Smt. Padam Kumari Devi, A.I.R.
1993 All. 143].

(iii) By virtue of
the principal being not in a position to reflect or depose on the validity or
bona fide of a power of attorney before the court of law due to old age,
weakness, mental infirmity or incapacity, the credibility of such an instrument
becomes worthless, in the eyes of law. [Mahendra Pratap Singh & Anr. v.
Smt. Padam Kumari Devi, A.I.R. 1993 All. 143].

(iv) A power of
attorney holder cannot give evidence on behalf of the Principal. According to
Order 32, Rule 15 of C.P.C. the general principals relating to a suit by or
against a minor would also apply to persons of unsound mind or mentally infirm
in capable. In this regard, a suit on behalf of such person may be filed by the
next of guardian or friend but by leave and an order of a court of law.
[Mahendra Pratap Singh & Anr. v. Smt. Padam Kumari Devi, A.I.R. 1993 All.
143].

(v) If the principal
is suffering from mental infirmity or incapacity to such an extent that he/she
can neither comprehend/safeguard his/her assets and properties nor can take
accounts from the agent or enable the agent to do so, then such 'power of
attorney' is worthless. Consequently, the relation between such principal and
agent is non- existent and treated as unforceable in the eyes of the law.
[Mahendra Pratap Singh & Anr. v. Smt. Padam Kumari Devi, A.I.R. 1993 All.
143].

(vi) Where from the
language of a general power of attorney, it is immaculate clear that the
intention is to confer such power which is "absolutely unqualified"
and it doesn't express any "limitation or restriction", then it must
be read or held in the same manner. [Syndicate Bank, Bangalore v. I.K. Amita
& Ors.; A.I.R. 1985 Karn. 213].

(vii) It was held
that a power of attorney may also need judicial interpretation of the facts
& circumstances of each case and a legal look at the "manner &
purpose" of the principal giving the power to the agent so as to
"fathom the yardstick" of the power. The principles enunciated for
proper construction of a power of attorney were:

(a) Only in case of
ambiguity, the operative part of the instrument is controlled by the recitals.
The underlying fact/point is that "only in case of ambiguity, and not
otherwise shall this principle be applied or referred to.

(b) When the general
words follow a particular set of a acts, the role of the former is restricted
to what is necessary/essential for the proper execution/performance of such
particular acts. [Syndicate Bank, Bangalore v. I.K. Amita & Ors.; A.I.R.
1985 Karn. 213].

(viii) A power of
attorney holder who has necessary power to sell properties i.e. execute sale
and convey proper title to the purchaser, of the executant to discharge his
debts by applying sale proceeds of the scheduled property binds the executant
to perform the obligations arising out of such contractual deal. It was held
that in case of an auction sale, if the bidder fails to deposit balance of the
amount by the stipulated date, he is not entitled to "specific performance"
of the contract. However, consequently his right to get the refund is not
forfeited. [Doddarajappa v. Ven Koba Rao; A.I.R. 1986 Karn. 70].

(ix) A duly
'authorised agent of a partner is precluded from signing on behalf of the
partner an application u/s 26 A of the Income-tax Act, for registration of the
firm. The applicant has to do it "personally" as per Rule 6 of the
Income-tax Rules.

(x) Another
exception is in case of "application
for letters of administration" when the applicant has to execute a
'personal bond'.

3. Payment by attorney under power without notice ofdeath, etc., good.—

Any person making or
doing any payment or act in good faith, in pursuance of a power-of-attorney,
shall not be liable in respect of the payment or act by reason that, before the
payment or act, the donor of the power had died or become 1[xxx] of unsound
mind, 1[xxx] or insolvent, or had revoked the power, if the fact of death
1[xxx] unsoundness of mind, 1[xxx] insolvency or revocation was not, at the
time of the payment or act, known to the person making or doing the same.

But this section
shall not affect any right against the payee of any person interested in any
money so paid; and that person shall have the like remedy against the payee as
he would have had against the payer, if the payment had not been made by him.

This section applies
only to payments and acts made or done after this Act comes into force.

COMMENTS

(i) If the
power-of-attorney holder exceeds his limits as per the power granted to him, by
the instrument, then the provision of 'indemnity' in case of an act done in
good faith does not apply, even if he was unaware of the determination of his
power in consequence of revocation of power by or death/insolvency of the
principal.

(ii) However, when
the power-of-attorney in favour of the counsel ceases due to the death of the
party, he should get fresh power-of-attorney from his widow, if he desires to
act as such and also, if the widow so desires.

4. Deposit of original instruments creating powers-of-attorney—

(a) An instrument
creating a power-of-attorney, its execution being verified by affidavit,
statutory declaration or other sufficient evidence, may, with the affidavit or
declaration, if any, be deposited in the High Court 2[or District Court] within
the local limits of whose jurisdiction the instrument may be.

(b) A separate file
of instruments so deposited shall be kept and any person may search that file,
and inspect every instrument so deposited, and a certified copy thereof shall
be delivered out to him on request.

(c) A copy of an
instrument so deposited may be presented at the office and may be stamped or
marked as a certified copy, and when so stamped or marked, shall become and be
a certified copy.

(d) A certified copy
of an instrument so deposited shall, without further proof be sufficient
evidence of the contents of the instrument and of the deposit thereof in the
High Court 2[or District Court].

1(e) The High Court may, from time to time,
make rules for the purposes of this section, and prescribing, with the
concurrence of the 2[State Government], the fees to be taken under clauses (a),
(b) and (c)3.

(f) 4[ x x x x x]

(g) This section
applies to instruments creating power-of-attorney executed either before or
after this Act comes into force.

COMMENTS

According to
Curzon's Dictionary of Law, 4th Edn., First Indian Reprint 1994, 'affidavit'
means a written statement, sworn or affirmed, usually before a commissioner for
oaths, Notaries, Magistrates etc., in the name of the deponent. Statement on
affidavit can be generally subjected to cross-examination [Order 19(Rule 6) of
C.P.C.]. However, the English law generally does not allow its subjection to
cross-examination. The motive behind this exercise is to add "authoritative
sanctity" to the subject-matter of the statement.

5. Power-of-attorney of married women —

A married woman, of
full age, shall, by virtue of this Act, have power, as if she were unmarried,
by a non-testamentary instrument, to appoint an attorney on her behalf, for the
purpose of executing any non-testamentary instrument or doing any other act
which she might herself execute or do; and the provisions of this Act, relating
to instruments creating powers-of-attorney shall apply thereto.

This section applies
only to instruments executed after this Act comes into force.

COMMENTS

Earlier, a married
woman though a minor could appoint on attorney on her behalf u/s 5 of this Act,
but after the Amendment Act of 1982, the concept of 'full age' has been introduced, i.e. she must be a major above the
age of 18 years.

Our Chs Attorney

ADV. R. P. RATHOD.Advocate High CourtPracticing at Mumbai & Thane Region in the field of Civil Laws: Specializing in matters of Property Law, Co-operative Law, Consumer Laws, Drafting & Conveyancing, Taxation, etc. . . .He mentions: "Nobody in this World is perfect, atleast I am not. We are all learners, atleast I am."www.advocaterathod.com